Can You Innovate Like a Unicorn?
July 14, 2021 | Webinar
Innovation has become a critical priority for business. The speed of change has accelerated, and if you’re not staying ahead of consumer preferences, you risk getting left behind. So how does a company build innovation, agility and velocity into its DNA? What can today’s business leaders learn from the more than 850 “unicorns” around the world – those privately held start-ups that go from founding to valuations exceeding $1 billion in less than ten years?
In a recent episode of Wednesdays with Woodward®, Travelers Institute President Joan Woodward was joined by an expert panel for an in-depth conversation on learning to innovate like a unicorn.
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The Innovation Ecosystem
The pandemic sped up the digital transformation already underway. In the insurance industry, Travelers’ Chief Innovation Officer Kevin Smith said this shift has been seen in distribution changes, changing risks and products, and a massive increase in real-time data. “The big winners of the pandemic were those companies that were ready for a seamless shift from physical to digital experiences for employees, customers and agents,” he said.
The digital acceleration may have also generated a spike in new unicorns. What’s the secret of their success? Sabine VanderLinden, an insurtech veteran and Co-Founder, CEO & Managing Partner of Alchemy Crew, surmised that these successful startups have been able to harness the pandemic’s rapid digital expansion and attract record venture capital. “They use digitization to make customer engagement processes leaner, better and cheaper,” she said, “And all of them are doing things which aim to drive friction-free and embedded experiences for underserved customer segments.” She went on to say that unicorns focus on doing a limited number of things well, developing a single centralized digital platform, and prioritizing being “hyper personalized” and “hyper localized,” while also being international in reach.
Established organizations are an important part of the innovation ecosystem. Smith said that established companies have the advantage of scale and the ability to invest, and through their interactions with other players in the innovation space, create a critical innovation ecosystem. He said that Travelers is using these advantages to innovate by building new experimental offerings, partnering with new capability providers and investing in market leading insurtech players.
Drawing from their experiences, panelists shared several pieces of advice on how to advance an innovation agenda:
- Understand the problem before jumping on a solution, said Beth Maerz, Senior Vice President for Platform, Customer Experience and Innovation for Personal Insurance Innovation at Travelers. She described her work with VanderLinden in the startup community in Hartford, Connecticut, saying that startups today bring so many great ideas, it’s hard to find a solution she doesn’t like. That said, that doesn’t mean they solve for her business problem. “The real challenge for us as innovators is to make sure that we're spending time understanding the problem that we're trying to solve for,” she said.
- Be prepared to be wrong. “Failure is part of building a backbone and building humility. It’s a learning opportunity,” said VanderLinden, underscoring that in the world of startups, companies are agile, continuously adapting and learning from failure. Maerz added that companies should be ready to iterate and pivot when a product is not right. “Learn from the failures and figure out how to move the product and the solution forward.”
- Get outside. Maerz also shared that no matter your organization’s size, innovation begins with getting outside. “None of us has the ability to come up with truly great ideas just by sitting inside the four walls of our own company,” she said, noting that Travelers has learned from others, including startups, to help reimagine and rethink pain points. One critical outside perspective is from your customer, she said, noting that Travelers has used in-depth customer interviews to adapt and create new products.
- Velocity is key. “Move quickly and challenge your organization to create new products at a faster speed,” and then being willing and ready to evolve and iterate the products, Maerz advised. VanderLinden added that she typically sees startups decide whether a venture is worth pursuing within 3 months, or 12 months for more sophisticated products that need to be market tested.
- Be aware that innovators are everywhere. Smith said that his teams invest time creating a culture of innovation across Travelers’ 30,000 employees, who have the opportunity to participate in the company’s annual innovation hackathon. “We think it's really important to bring all 30,000 along on this journey,” he said. Maerz agreed and closed by saying, “there’s no magic person out there who’s an innovator. It’s really about giving all individuals the opportunity to be innovative.”
Presented by the Travelers Institute and the Master's in Financial Technology (FinTech) Program at the University of Connecticut School of Business.
Senior Vice President, Platform, Customer Experience and Innovation, Personal Insurance, Travelers